Measuring Missed Time

According to a 2007 study by Ipsos Reid, people gain on average one hour of productive time per day by having a Blackberry.  That is an average of 250 hours per year!  Regardless of whether an attorney has a Blackberry or not, it isn’t a stretch to say that attorneys miss at least one hour of billable time per day.  At an average rate of $200 per hour, this can result in lost value of up to $50,000 per year per timekeeper!  Recovering “lost” time can help increase profitability as well as provide leverage opportunities.

The problem is establishing the habit of timekeepers entering time regularly.  As in every other area of law firm management, measurement improves performance.  Using a Missing Time Report, such as the one shown below (click to enlarge), can help timekeepers get into the habit of paying attention to their time spent serving their clients and making sure they are recording the time spent on such activities.

In this report, the timekeeper can see the days they missed during a range of days – whether it be a month or week or whatever the time range entered.  A gauge is a good graphical method of tracking time entered for the range – in the case of the report to the left, it is looking at a month’s range.  The minimum hours is set to 167, or just over 8 hours per day.   Any day that the timekeeper does not enter 8 hours is shown, as well as the average rate on the day the time target was missed.  This will be used at the end of the report to determine value of the time missed.

The report also shows, per timekeeper, the total number of days where the time target was missed and the total hours entered for the range of dates.  The report should be flexible, however.  As much as we would like attorneys to enter time daily, some are stuck in the habit of recreating time at the end of the month and, if they are equity partners, they can minimize the value of this report by explaining that it doesn’t take into effect their total hours at the end of the month.  Therefore, the report should first filter out any timekeeper that, over the entire range of dates, records the minimum time expectation regardless of whether it was put in daily or all in one day.  If the firm decides that it wants to enforce daily time entry, that is fine.  The report just needs to be flexible in the event that the firm can’t enforce such a measure.

Finally, the report summary should show what timekeepers are accounting for the lost time, as a percentage.

This way you know who may need additional mentoring (or needling) in developing good time recording habits.  To emphasize the importance of recording your time, add  in the report summary  the total days where the target wasn’t missed, the total time missed, the average rate of all timekeeper time lost and the value of the time lost (the total hours missed multipled by the average rate).

Click on the graph to the left to see it in action.  If you are interested in using reports like the one described in this post, please feel free to email me or call (205) 588-4622.

Process Modeling: Putting To Print Things That Work

For most firms, knowing what needs to be done to effectively manage a case is something learned through time and experience.  Unfortunately, this valuable information is rarely put to print for others to follow.  The result is constant “reinvention of the wheel”.  For associates, how well you can swim after being thrown in the shark-infested pool determines whether you become partner, career associate or looking for other work.

Likewise, if there is staff turnover, how quickly they are up to speed on your processes will determine how long it takes for productivity to reach or exceed pre-turnover levels.

Modeling your processes provide a concrete method for everyone in the firm to know not only what is expected, but why the expectation is in place and how to go about performing the task(s) in a manner approved by the firm.  This has several benefits, not the least of which is a reduction in the “change curve” time,  improved efficiency and the increased capacity to scale.

There is, of course, a process to building the process model.  The first step is to outline all of the processes in the firm.  This includes administrative processes, practice-related processes, client and matter-related processes, and any other process that pertains to firm business.

Once outlined, those who have the experience must brainstorm and put to print all the years of experience that has taught them to know on instinct what to do as the work-flow meanders from question to question.  Mapping this visually helps to find the gaps and gives you the opportunity to take out redundant tasks which may cause bottlenecks that reduce efficiency.

The example to the left is a mapping of a collections process (click on it to view in full screen).  It started with just picking a point in the process, going through the steps, then reading and re-reading to fill in the gaps and add in the details.

Once you have the process visually mapped, the next step is taking each step and reviewing why it is there.  The “why” helps to confirm that the step is necessary – if you can’t figure out why a step is needed, then it isn’t needed.  The “why” is also for new employees or others who may have to temporarily perform the task later.  One of the complaints I often hear from partners has to do with the lack of “ownership” some in their firm have towards files given to them.  In my opinion, a lack of understanding the entirety of the file is one reason an associate may do subpar work.  Thus, part of the process of taking a file from a partner should include a thorough reading of the file, paying particular note of certain things the partner always looks for to help understand the important issues in the file.  Although this is obvious to those with experience, it may not come as second nature to new associates or staff.  The “why” helps them see it from the partner’s perspective without forcing the partner to lose productive time in having to explain it.

This has more than one benefit.  Although highly unlikely (tic)¹, it may be that the partner’s time tested process may miss out on a detail or two that an enterprising associate or support staff discovers.  In cases such as this, having the “why” helps the associate or support staff understand the purpose and he/she then can propose process enhancement, furthering continuous process improvement².  (This can be encouraged through upward reviews).

After providing the “why”, the next part is the “how”.  Use a step-by-step approach so that others can follow the process in an easy-to-understand manner.  An example approach for a collections process would be:

1. Sort AR for collectible and non-collectible accounts;
2. Distribute to responsible attorneys to determine if any should be held from normal process;
3. Determine age of oldest unpaid  invoice;
4. If older than:
   1. 30 days – go here
   2. 45 days – go here
   3. 60 days – go here
   4. etc
5. etc

After completing this tedious but necessary list, model it visually through a tool like Microsoft’s Visio.  An example output for a part of the above process might look like this:

After review of the processes to ensure they are appropriate and are easy for others to understand, make it easily available for your staff to access.  In today’s connected world, this means access through a web browser.  Your site should be easy to access from within the network and should be easy to navigate.  An example site may look like the below (shown without theme – in practice it may mimic your external website’s design):

Besides the benefits discussed above for modeling your firm’s processes, there are quantifiable reasons as well that can lead directly to the firm’s bottom line.  For example, you can assign an amount of time it should take to perform a certain task.  Having this information available allows you to set baselines for performance reviews (efficiency of employee versus the firm efficiency standard).  It also gives the firm an opportunity to offer different billing options to clients; for example, if a client desires more cost certainty, the firm can offer a flat rate based on how long it takes to perform the tasks in a typical case, taking into consideration the facts and the potential to vary from the norm.  You can then add your margin to this number to provide a fee that is both acceptable to the client and ensures profitability for the firm.

As you can probably note from reading the above, modeling your processes is a tedious and time-consuming process in itself.  However, the benefits of taking the time to map, model and follow your processes shouldn’t be understated.  Not only will it improve the manner in which work is performed, but it can bring measurable benefits to your bottom line.

Of Counsel Consulting can help your firm map, model and price your processes so that you attain maximum benefit for taking the time to further the goal of continuous improvement.  Please feel free to call or email us for more information.

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¹ tongue in cheek – Go Back
² The idea of continuous process improvement isn’t new but is laid out nicely in a book written by Tom Pryor called Using Activity Based Management For Continuous Improvement that I recommend. – Go Back